John Miles sees continued growth with XRAY
NEW YORK, April 27 (Reuters) - Dentsply International Inc., a maker of dental products, backs estimates that it will earn $1.60 a share in 1998, compared with $1.37 a share in 1997.
"I think most analysts expect us to earn $1.60 this year and that's a number we're pretty comfortable with," said John Miles, vice chairman and chief executive officer, in a
telephone interview Monday.
"We're looking for EPS growth of 15 percent (a year), at least for the next three to four years," he said.
Dentsply earned $0.35 a share on sales of $180.7 million in the first quarter of 1998, compared with $0.31 a share on sales of $172.4 million the year before.
Of the increased sales, 5.5 percent came from acquisitions made during the past year and 5.8 percent came from businesses already owned. Currency hurt sales by 2.5 percent and a
divestiture the previous April lowered sales by four percent.
About half of Dentsply's sales come from abroad.
Miles said that he expects international sales to grow faster than domestic sales but noted that this could be
counteracted by greater acquisition opportunity in the U.S.
The York, Pennsylvania-based company made six acquisitions last year and has made three so far in 1998.
"It's certainly reasonable to think that we will do at least as many this year as in the last," said Miles, who will become chairman and CEO in May.
Dentsply has made 15 acquisitions in the past 2-1/2 years, all for cash.
The CEO noted that the company has adequate cash flow, along with $270 million available from a credit facility, to support its acquisition program. He does not see the need to come to the capital markets to support growth activities.
Miles said that over the last three years the company has launched 20 new products a year and will do the same in 1998.
In 1997, the company's dental consumables and lab products segment accounted for 73 percent of sales, while its dental equipment business accounted for 22 percent. The remainder was from non-dental products.
Miles said that the profitability of both segments is roughly equal. He said that gross margins are higher for
consumables, but it costs more to sell them.
"The worldwide dental market is growing an average of 5-6 percent. We look to achieve internal (sales) growth of 7-8 percent. Clearly our strategy involves taking market share from our competitors," Miles stated. |
